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Its been a while since my last update – mainly because I have been absolutely flat out selling heaps of property – in particular in the NRAS scheme. I see that investors have finally worked out the benefits of the NRAS and are rushing in to secure their cash flow positive investment.

If you are yet to hear about the NRAS ( National Rental Affordability Scheme ) give me a call, and I’ll be happy to tell you how it works. If you are looking to buy an investment property, be quick, as stock levels are very low.

I’ve spent a bit of time in central Queensland over the past 3 months setting up a team to sell property in the NRAS scheme. I must admit I’m fast becoming a fan of the investment opportunities available – especially in central QLD around the Bowan & Surat Basins. In my opinion it’s a bit late for investment in Gladstone but surrounding areas like Mackay, Rockhampton and Bundaberg are prime for the picking. Add NRAS with tax free govt incentives and you are on a winner. See below for some of the opportunities we have found or call me for more info.

A number of calls have come in recently, mainly from developers, asking if I can help them sell their properties and/or work out why they aren’t selling. Upon further investigation I found that there are a heap of developments, and property, that are listed on the internet multiple times – sometimes in the hundreds. I then started looking at the internet more closely and realised this is a common occurrence.

For example blocks of land. Many real estate agents will list every block in the estate separately creating up to 100 listings Then the building reps will take 5 lots each and put their packages in the land for sale, new homes and houses for sale sections.  Times that by 16 building companies – further increasing the amount of listings on the internet, and then on multiple websites. In many cases I have counted over 200 listings for a small number of blocks.

When speaking to buyers they are constantly complaining that the internet is becoming very confusing and it takes hours to trawl through properties to find what they are looking for. Personally, I have to agree with them.

Taking this approach only makes it much harder to sell your property.  It doesn’t help when the media have a field day with “record High number of listings” amongst the other garbage they print and disseminate.

Interest rates – are you as sick as I am of hearing about imminent rises. Seems the general public are too. I find that the weekend prior to the RBA meeting is dead on the home open front, and then after their meeting – the following 2 weekends, we are inundated with home open attendees and investor inquiries.

The RBA even had the nerve to come out a couple of weeks ago and say the public are dragging the economy down with their GFC mindset. Nice work guys!!

I’m constantly hearing about how it’s a buyers market from buyers who are peeling out their cash and paying above asking price for property. I’ve had more cash offers in the last 3 months than the entire 8 years prior of being in real estate.

I’m also impressed to see that heaps of people are learning about the benefits of leveraging their superannuation and using property warrants to borrow for property in their super funds. We have an expert in our office along with helpful support people to facilitate your transition into this area.

All in all the real estate market future is still looking bright – if you’re buying, there is great choice and some really good buying – if you’re selling, it’s critical to get your property priced perfectly. So what ever your current needs are, I’m always happy to help.
his. Unlike other agents once we have secured your business our work actually begins.

Click here to book your seats or call Rob on 0417 770 855.

Our Next Seminar in Perth is:
Date: Web 3rd August
Venue: TBA

Upcoming National Seminars:
Brisbane – Sat 16th July 2011
Melbourne – Tue 12th July 2011
Sydney – Sat 23rd July 2011
Perth – Wed 3rd August  2011

Bring on the New Year

Happy New Year everyone!! Our new site is almost complete, just in time to set off the new year. Keep a look out for when its done.

WA Planning Commission vs Lenders vs Developers … and the winner is?

What is happening around town?  The land shortage continues and developers are grabbing what they can right now.  The other day I sat through a debate convened by the UDIA (Urban Development Institute of Aust) to discuss the land shortages.   There were two sides putting forward their ideas.

The WA Planning Commission put forward their view – shortage of land isn’t created by them, it’s the banks not lending, Water Corp & DEC hold ups etc.

The Lending institutes put forward their view – how can they lend on uncertainty of decisions of Govt departments and development timeframes.

And the winner is ….

The Developers!  There will be a shortage of land because of all the aforementioned reasons put forward by both sides.

The last couple of months have been generally slow moving in the real estate market. End of financial year, first homebuyers dropping out of the market and our first Prime Minister assassination being the main culprits.

First home buyers have really been struggling to get into the market with lending criteria tightening in recent months, however the investors have quickly taken over from them realizing they may have a bit more choice and time to make their decisions.

All in all the real estate market future is still looking bright – if you’re buying, there is great choice and some really good buying – if you’re selling, it’s critical to get your property priced perfectly. So what ever your current needs are, I’m always happy to help.

What type of property information do you believe in?

I saw the following 4 headings about real estate on a news website the other day and though I just have to share this. These headings were listed as follows one after the other on the same day

•    Housing shortage hits critical levels
•    Property prices post largest fall since 2008
•    Cheaper suburbs push house prices up
•    Mortgage applications on the rise

A mixed message from the media outlet, however it kinda reflects the sentiment of the real estate market in the last 3 months – UNCERTAINTY.

Given that we have had the elections, threat of interest rate rises, constant GFC doom & gloom, conflicting media and the banks squeezing borrowers like first home buyers, second home buyers, developers, self employed, Lo & No Doc’s, equity rich but cash flow poor, cash rich but equity poor, national and international investors out of the lending market – this not surprising.

While on the topic of banks, it was surprising to see the $5.66 billion bank profit achieved for 1 lender last financial year when funding can be challenging and expensive for the lenders! – It’s also very interesting how the banks’ super profits don’t attract super taxes unlike other profitable industries!!

BIS Shrapnel are predicting that commercial property will increase by 50% over the next 3 years.  Western Australia got the title of best economy in Australia and Mr Gavin Hegney indicates Perth is the place to invest.

Investors are running rampant with property at the moment. People with money to invest or access to lending are making the most of their property investing choices while they can.

We are finding more and more investors opting for NRAS investments as they are cash flow positive and allow people to buy more than 1 – all of the other benefits are just a serious bonus.

What type of dwelling should you invest in?

Being involved with the NRAS (National Rental Affordability Scheme) has enabled me to access some pretty interesting research on housing.  In particular the affordability of housing and the types of dwellings we require for now and in the future.

In the government’s studies into housing for the NRAS, they discovered a massive shortage of 1, 2 and 5 bedroom accommodation. Considering that just about everyone I speak to about investing, first home owning, upgrading and downsizing requires a 3 or 4 bed dwelling, this is not surprising.

After learning about these shortages I started to talk to people about this – most couldn’t and/or can’t conceive that we may have to live in smaller dwellings in the future. 

I then decided to do some research for myself and discovered that, in Australia, there are currently about 1.8m people living alone and that is predicted to double in the next 15 years. Approximately 35% of the population live as couples and this will increase to 52% over the next 15 years. How does this portion of the population reside? Answer = probably in dwellings too large for them.

When you put the above stats into perspective along with the research undertaken by the government, you have to wonder why developers and investors aren’t catering for this market/demographic – and also – with the number of people per dwelling declining rapidly what kind of housing crisis might we face in 10 years time?

Add to the equation that the costs of running a household are increasing rapidly – will we end up with an over supply of 3 & 4 bed dwellings that no one can afford to buy, rent or run?  An interesting question, and also an issue we must start thinking about.

The results of the RP Data-Rismark Home Value Index for June showed that the unit market has outperformed houses over the last 12 months and during the last five years.

Historically, houses have enjoyed a much more rapid appreciation in value than the growth recorded by units. There are a number of reasons for this more rapid level of growth: greater demand for houses, diminishing availability of development land, higher quality of stock and design available for houses rather than units and the great Australian dream to own a house rather than a unit, amongst a number of other reasons.

Despite these factors, over the last five years units have recorded average annual value growth of 7.4% compared to 7.1% for houses. However, the results suggest that the superior performance of units compared to houses is quite a new phenomenon as over the last 10 years the average annual value growth of houses (9.9%) has well and truly outperformed units (8.0%).

Perhaps with time we will be able to swallow the pill of smaller blocks and dwellings for residing and investing in and also embrace the new Australian dream of home ownership – Can I afford one?!